Thread by @JackNiewold

Ok I’ve written up some threads on the bull case and the bear case for $SPELL

Let’s talk about my personal opinion on the asset: 👇

We can talk about flawed token economics all day long, we can talk about how Daniele Sestagalli is the king of the frogs 🐸 and how WAGMI, both are unquantifiable.

Valuations are memes, and we need to understand that crypto valuations as more nuanced than equities.

To me, the value proposition of $SPELL is strong.

I’ve used it to borrow, the concept of borrowing against yield bearing tokens is revolutionary and the demand is there.

Take a look at the cauldrons: yield bearing pools are empty while token pools like $FTX and $SHIB are full.

The demand for $MIM is there and the marketing is strong. The meme is strong.

If the most interesting outcome always comes true in crypto, ‘Magic Internet Money’ will take incredible market share away from DAI and other decentralized stables.

And the narrative around centralized stables being unsafe and unsecured could come true as well: right now there’s nearly $150 billion in centralized stables, that may or may not be legitimately backed.

And token issuance schedules be damned, in my time in crypto I’ve learned to never short a meme.

If $MIM grows and people continue wanting to borrow against yield bearing assets (a no brainer), the token price will go up. Period.

You think the protocol behind a stablecoin worth $50 billion will only have a market cap of $1 billion?

No way, the market cap will grow despite emissions because the protocol will grow in value.

Having Abra and $SPELL available cross chain will help tremendously.

The average loan size for now is about $130k so no smaller players are borrowing, even though it’s very low risk leverage.

Cross chain lending opens the floodgates as no one wants to pay $300 in gas.

The question, then is how all of these dynamics affects token price. Staking helps, as you get a piece of growing revenue.

And if you believe in the lending protocol, the cross chain expansion, and increasing TVL, token price will simply go up.

As long as the protocol is growing, and quickly.

Because if the protocol isn’t growing in value, token price will drop due to inflation.

Anyways, those are my thoughts today.

I still think it’s a good deal under 2 cents and a good LT investment if you believe in $MIM growing as a stablecoin.

That’s just kind of my gut feeling.

What do you guys think? Where do you see short and long term token price going?

What signals are you waiting for to invest or to take profit?

While I sometimes ramble in Twitter threads, my newsletter discusses fundamentals, valuations, mimetics, technicals, and more, all with a data -backed approach.

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